Saudi-PGA Tour

PGA Tour, LIV Golf formally drop antitrust lawsuits, ending year of legal battle

June 16, 2023

LOS ANGELES — The PGA Tour and LIV Golf have filed a motion to dismiss LIV’s antitrust lawsuit and the tour’s countersuit, ending a nearly year-long litigation battle between the two organizations.

The arrangement was telegraphed last week as part of the surprising announcement that the tour and LIV’s financial backer, the Public Investment Fund of Saudi Arabia, were forming a new for-profit entity together. There was a provision in that deal that called for all pending litigation between the tour and PIF to be dropped within 10 days. The provision was made official Friday afternoon in U.S. District Court in the Northern District of California.

Last August, 11 LIV Golf members, including Phil Mickelson and Byrson DeChambeau, challenged their suspensions by the PGA Tour for defecting to the Saudi-backed circuit with an initial antitrust suit. “The purpose of this action is to strike down the PGA Tour’s anticompetitive rules and practices that prevent these independent-contractor golfers from playing when and where they choose,” the complaint alleged. LIV Golf eventually joined as an interested party in the case, with lawyers arguing the league had to start in the face of reduced access to players with super-competitive costs. LIV Golf wanted “punitive damages for the PGA Tour’s bad faith and egregious interference with LIV Golf’s contractual and perspective business relationships.” With LIV as part of the lawsuit, all 11 players eventually removed their names from the proceedings.

In late September, the PGA Tour filed a countersuit, asserting that the case was not about unfair competition—“if anyone is competing unfairly, it is LIV, not the tour”—and accused the LIV-backed lawsuit as a “cynical effort to avoid competition and to freeride off of the tour’s investment in the development of professional golf.” The tour also accused LIV Golf of a coordinated campaign of “ongoing interference” with contracts between the tour and players strictly so LIV could convince a court to alter the tour’s structure to benefit LIV at the expense of the tour.

The PGA Tour had won a series of early decisions in the litigation fight, including the denial of a temporary restraining order for LIV players seeking to compete in the FedEx Cup last August. Additionally, a decision in the tour's favor (that was being appealed) noted that the PIF and its governor, Yasir Al-Rumayyan, were not protected by immunity law from producing documents and being deposed. The lawsuits were notable for a number of reveals that were uncovered in court documents, such Mickelson’s suspension before the launch of LIV for recruiting players, that DeChambeau had signed with LIV despite his publicly stating otherwise, and the accusation from LIV that Augusta National and its chairman Fred Ridley tried to persuade players from joining the circuit.

Earlier on Friday, the New York Times filed a motion to intervene, asserting the public’s right of access to court records asking for the court to unseal documents despite the litigation going away. The order will be heard on Aug. 3, 2023.

The proposed deal between the PGA Tour and PIF calls for a new agreement to be completed by the end of the year. Should that not come to pass, however, the litigation between the tour and LIV/PIF cannot be reopened.

Obstacles still remain for the PGA Tour-PIF partnership to ultimately come to fruition. Earlier this week the U.S. Senate opened an investigation into the pending deal, citing that the alliance “raises concerns about the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity assuming control over a cherished American institution.” The deal could be reviewed by the Committee on Foreign Investment in the United States, which analyzes mergers regarding potential threats to the nation’s security. Additionally, the tour continues to be under an antitrust probe by the U.S. Department of Justice, and PIF’s investment into the tour is expected to fall under this investigation.

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